1. Industry-wide data
Although there has been significant growth over the last few years in e-commerce, there is a notable decline that was registered of nearly $45 billion looking back to 2020. An almost -10% loss in the negative compound annual growth rate is blamed upon the pandemic. However, as with all things, course corrections are possible and this will hit nearly $675 billion by 2023.
Retail sales have increased in the United States significantly, accounting for nearly 30% of all fashion sales. Global predictions are representing the potential of $100 billion level, and that should occur in 2021.
There are five things to take from all of this:
- When looking at any of the markets outside of the West, you can see expanding markets happening
Smartphones and access to the Internet are making sales easier every day - The middle class, as a result of getting more disposable income, is spending it more readily on the web
technologies have made it easier for e-commerce companies to generate sales - Influencers, along with well-known celebrities, are also helping to influence these numbers
Perhaps the biggest threat is in regard to established brands for the following reasons:
- Brand loyalty is diminishing
- Online return rates are much higher
- Access to fashionable styles is increasing
- The development of green materials is demanded by consumers
- There are strategies to use when dealing with these issues. Let’s look at sub- verticals now.
2.The COVID impact
In recent years, due to the pandemic, e-commerce predictions have not come true. Back in March 2020, consumers said they were going to spend less money on e-commerce items.
Despite consumers saying this, online retailers have seen an increase in sales. As much as 30% or more of growth has been seen in 2020. Nearly 50% increases in the UK have also been seen during the same period of time.
Global fashion retailers really did not have to adjust anything at all because of the pandemic as can be seen looking at how much they have made.
Athleisure has emerged as a very strong market. The market value, for instance, was just over $150 billion in 2018. However, it is thought to be rising to over $250 billion by the year 2026.
During the time when stores, schools, and workplaces were completely shut down, this was a top-rated product and it seems to be where people chose to spend a large portion of the stimulus check that they were provided with during the pandemic.
This has resulted in many companies like Nike seeing record sales as a result of the pandemic occurring.
3. Clothing and apparel
It is perhaps the lowering of digital barriers that have made it possible for orders to be fulfilled on a global level, and also because selling products is nearly automatic. Both domestic and worldwide revenues are projected to increase. If you would like to know does shapewear reduce belly fat then see here.
If you take a look at Europe, you will find that most people will spend about $1000 every year on fashionable items.
However, as these numbers continue to grow worldwide, there is the potential of it slowing down: for example, looking at the years of 2018 through 2022, there was a nearly 8% drop in sales. Fashion e-commerce was also minimized, between the years of 2017 and 24, to just about 3%.
There are some that blame Western market saturation for this trend. When looking at growth rates, and comparing them to the United States, China, and Europe, this even looks worse.
CAGR numbers, when looking at 2017 to 2022, you will see the following:
- 8.7% in Europe
- 8.8% in the US
- 14.1% in China
4. Shoe segment
The shoe industry has actually benefited greatly during the pandemic, specifically in regard to market value. The market size at a global scale for footwear is projected to increase from just over $360 billion to over $530 billion in 2027.
